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Pitney Bowes reworks its biggest unit by revenue: Global Ecommerce

Paul Demery — Wed, 31 Jul 2024 21:57:09 +0000

Pitney Bowes Inc. has its eye on Global Ecommerce, the primary but changing revenue-producing business unit at the worldwide shipping and mailing products and services company.

Global Ecommerce made over $1.35 billion last year for Pitney Bowes. That was more than 40% of Pitney’s total revenue of $3.27 billion that year. It also led Pitney Bowes’ fiscal first quarter, which ended March 31, with segment revenue of $333 million. Global Ecommerce provides business-to-consumer online companies with logistics services for domestic and cross-border fulfillment, delivery and returns throughout the U.S. and more than 200 other countries.

132 retailers in the Top 1000 use Pitney Bowes as a shipping carrier. Those 132 retailers made more than $529 billion in 2023 web sales, according to Digital Commerce 360 data. Additionally, 68 use it for international ecommerce services, and 16 use it for fulfillment services. The Top 1000 is Digital Commerce 360’s database ranking North America’s largest online retailers by their web sales.

Pitney Bowes Global Ecommerce hits growing pains

In this year’s first quarter, “Global Ecommerce grew domestic parcel volumes 20% in a challenging market and reduced operating expenses,” Pitney’s then-interim CEO Jason Dies said on a Q1 earnings call.

But Global Ecommerce, one of three Pitney operating segments, has also been reporting the company’s steepest segment revenue and earnings declines: a Q1 EBITDA loss widened 14% year over year to $21 million as the unit’s revenue fell 26% to $333 million. By comparison, Pitney’s other two segments — SendTech Solutions (a mailing technology and services unit) and Presort Services (a mail-sortation business) — each amassed relatively strong financial quarters, as Pitney Bowes’ total revenue dipped by 0.005% to $830.51 million.

In 2023, Global Ecommerce’s revenue fell 14% year over year to $1.36 billion, as Pitney Bowes total revenue dropped 8% to $3.3 billion.

Lance Rosenzweig, interim CEO, Pitney Bowes Inc.

The Stamford, Connecticut-based company, under a new interim CEO appointed in May, Lance Rosenzweig, is conducting a review of Global Ecommerce’s options going forward. In addition, it recently sold the unit’s fulfillment services business to Stord, an Atlanta-based company that specializes in providing fulfillment services to online merchants. Pitney Bowes didn’t provide details on that sale but told industry publication Freightwaves that fulfillment services were a “small piece of the business.”

Rosenzweig joins Pitney Bowes after serving as a top executive at several public and private companies, including Boingo Wireless, technical support services firm Support.com, and customer experience software company Startek.

Pitney seeks a new head of Global Ecommerce

Gregg Zegras, former president, Global Ecommerce, Pitney Bowes

The Global Ecommerce unit’s recently departed president, Pitney veteran Gregg Zegras, retired earlier this month. Pitney Bowes has yet to name a replacement for Zegras.

Pitney Bowes said earlier this month that it was in the final stages of an “expedited strategic review of Global Ecommerce to eliminate ongoing operating losses.” The company recently identified $70 million in cost savings outside of Global Ecommerce and expects to eventually realize overall savings between $120 million and $160 million.

Stord’s acquisition of Global Ecommerce’s fulfillment services includes a 640,000-square-foot warehouse facility in Hebron, Kentucky, with robotic automation and other features. Stord said that facility is now the largest warehouse in its North American network.

Earlier this year, Stord acquired Pro-Pack Logistics, a fulfillment services provider to multichannel merchants in the U.S. and Canada, and it launched Stord Europe with fulfillment centers in the United Kingdom and the Netherlands to support B2B and B2C markets throughout Europe. Stord says it manages more than $5 billion in commerce annually through its fulfillment, warehousing and transportation services.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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Procurement plays a more critical role in business operations

Paul Demery — Fri, 26 Jul 2024 21:08:57 +0000

Procurement is growing far beyond its traditional support role in purchasing business materials and supplies.

CPOs who did well are those who went and found new sources of supply or who focused on protecting revenues or margin, rather than focusing exclusively on cost.

Roman Belotserkovskiy, partner

McKinsey & Co.

Klaus Staubitzer, chief procurement officer and head of supply chain, Siemens AG

“Recent events, like the Covid-19 pandemic and focus on sustainability, have given us the opportunity to establish procurement and supply chain as a key value function instead of a simple support function,” Klaus Staubitzer, the chief procurement officer and head of supply chain at technology and engineering giant Siemens AG, says in a new report on procurement industry trends from Economist Impact and business software company SAP SE.

But the report notes that living up to that “key value” provider role isn’t easy and requires more coordination among procurement and other business departments as companies deal with ongoing supply chain threats, such as the armed conflicts in sea lanes that arose after the pandemic.

The report, “Across the procurement-verse: changing trends in the procurement function,” is based on a first-quarter 2024 global survey of 2,307 senior executives across various business operations, including supply chains, financial management and human resources as well as procurement.

The report asserts that while most executives recognize that procurement departments have made notable strides in collaboration with other departments, “procurement teams have considerable room to improve collaboration skills.”

“While 75% of executives agree that procurement collaborates effectively with the business on issues of strategic importance (up from 53% last year), only a fraction of these (18%) have high confidence in procurement doing so, and only 14% have high confidence in the application of procurement insights across the organization,” the report says. “Procurement has yet to gain the full trust of stakeholders in this area.”

The report, citing crucial trends in AI and supply chain diversification, also asserts:

Procurement’s success in digitalization increasingly rests on its ability to adopt and master emerging technologies.

“Accelerating digitalization is the highest procurement priority for the majority of respondent organizations over the next 12-18 months, and AI adoption is a centerpiece of these efforts, cited by 44% as a top technology priority,” the report says. “The respondents make clear AI should play a key role in improving procurement process automation.”

Procurement teams are seeking a balance between centralized and decentralized operating models.

Asked about procurement operating model changes in the next 12-18 months, survey respondents said their intentions were roughly evenly split between two directions: “One is increasing the role of centers of excellence (CoEs), which support best practices in strategic sourcing, knowledge management, performance tracking and other areas. The other is adopting a center-led model, in which the central procurement team makes decisions in key areas while leaving business units to decide on unit-specific procurement matters. CoEs complement and support a center-led approach.”

Businesses look to reduce supply chain risk in the long term by prioritizing supplier diversification — a priority cited by 40% of surveyed executives.

“In the shorter term, meanwhile, companies are putting stronger emphasis on supply-base consolidation (26% in 2024 v. 10% in 2023) given the push to build trusted relationships to overcome supply-chain challenges,” the report says.

Procurement and supply chain teams are also using new technology applications to improve how they ensure getting the right products for their organizations.

Pushing procurement’s more valuable role

For example, the report notes that Siemens uses “a digital twin (a digital model of a real-world product, object or process) to analyze, with precision, the material cost of the parts it purchases and how they are produced.”

The report adds that Staubitzer’s team at Siemens now also uses the tool to determine the CO2 emissions of those parts as well as the carbon footprint of the supplier’s entire operations. The survey uncovered a similar trend, noting that 46% of CPOs “prioritize carbon footprint mitigation, more than any of their counterparts.”

“Our suppliers are sometimes surprised that we have a better breakdown of these details than they have from their own calculations,” Staubitzer says.

Roman Belotserkovskiy, a partner in the Austin, Texas, office of the global management consulting firm McKinsey & Co., says the inflation trends in recent years have provided an opportunity for procurement teams to demonstrate their value and increase their prominence.

“CPOs who did well are those who went and found new sources of supply or who focused on protecting revenues or margin, rather than focusing exclusively on cost,” he says in the report.

Belotserkovskiy has also observed an increase in the number of CPOs presenting to their board of directors — another sign of increased prominence.

“That was very rare two or three years ago,” he says.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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The new digital supply chain stars: automated guided vehicles

Emily Newton — Fri, 26 Jul 2024 14:00:28 +0000

Emily Newton

Automated guided vehicles (AGVs) have become more common at supply chain locations worldwide, transporting containers and other loads between ships, trucks, rail cars and warehouses. Why are more leaders using them? Most use cases relate to relieving congestion and improving operations when ports experience record-setting traffic levels. Decision-makers recognize how AGVs can streamline their supply chains, keeping containers moving and preventing costly delays.

Leaders who use AGVs and other automated tools to strengthen their supply chains have more oversight and influence over the impact of supply chain fluctuations.

Accelerating the Movement of Goods

The supply chain’s persistent labor shortage can cause staffing crises that are particularly impactful during peak periods. Some leaders have deployed AGVs for material handling tasks, finding that such efforts help them maintain high productivity.

One example came from China’s Ganqimaodu land port. Each AGV moved between this port and a Mongolian coal stockyard, carrying two standard containers of imported products along a 1.86-kilometer route. An AGV takes 50 minutes per round trip and travels up to 25 kilometers per hour.

The AGV operator using them in China has 30 in its fleet, using 24 each weekday. They move 10,400 tons of coal daily during 160 total round trips. Additionally, there are 30 AGVs in Mongolia. Supply chain managers believe that using all 60 simultaneously will allow for achieving a 15-million-ton transport capacity.

To provide perspective on the overall coal-related activity at the port, leaders said each arriving truck holds up to four standard containers and makes four to six round trips per month. This initiative was the first instance of AGVs used at a land port for cross-border transportation, showing the potential of such applications.

Examples such as this show how AGVs can minimize supply chain staffing shortages, keeping each port as productive as possible during those challenging times. Moreover, AGVs can support other automation projects to relieve labor needs.

Japanese officials plan to address the labor shortage with a conveyor belt from Osaka to Tokyo. The so-called Autoflow-Road project would include infrastructure above and on the sides of roads, as well as tunnels underneath major highways. Estimates suggest this system could move loads equal to that of 25,000 trucks daily, and that each container placed on the conveyor belt would hold up to 1 metric ton of goods.

Facilitating Improved Forecasting

Multiple partners often handle goods moving through supply chains, especially when those loads require multimodal transport solutions. Clients understandably want progress updates on their container loads so they can plan associated operations accordingly. Managers frequently deploy connected technologies to meet those needs.

For example, the United Kingdom’s Port of Dover has an advanced digital twin that predicts the associated tidal flows and weather conditions, supporting safe arrivals and departures. That tool complements a landside digital twin that optimizes traffic flows and port operations while supporting decarbonization and energy efficiency efforts. Such visibility enhances predictions and reduces the reliance on guesswork. Supply chain clients benefit by passing on more accurate information to their customers, increasing the likelihood of repeat business.

People worldwide have warmly embraced online purchasing, appreciating its convenience and efficiency. In 2023, U.S. B2B ecommerce sales surpassed $2 trillion and U.S. retail ecommerce sales topped $1.1 trillion. And analyses suggest global retail ecommerce sales will surpass $8 trillion by 2027. Shoppers who receive correct estimates of incoming parcels can adjust their schedules accordingly, remaining available when they arrive.

Improving Resilience

Supply chain experts frequently assess their business models, identifying new ways to protect their networks from shocks that could severely disrupt their operations. Many search for process improvement options, knowing that even small tweaks can significantly improve outcomes.

These professionals must focus on the things within their control to minimize the effects of those that are not. Then, they remain better equipped to handle the various fluctuations common to their industries.

Freight indexes are nearly 10 times higher than pre-COVID-19 levels. However, leaders who use AGVs and other automated tools to strengthen their supply chains have more oversight and influence over the impact of supply chain fluctuations. Improvements could free up money in the budget for aspects outside their control.

Decision-makers may implement AGVs as part of more-extensive automation strategies, knowing targeted improvements will keep them competitive and profitable. A logistics company did that to prepare for Singles Day, which has become one of China’s most notable online shopping days. Business leaders created a robust, end-to-end system to support the supply chain from first-mile pickups to last-mile deliveries.

That all-encompassing effort allowed the enterprise to deliver more than 200 million parcels to customers who shopped for the occasion. AGVs played a significant role in the success. A single Thailand warehouse has 100 of the machines, which collectively reduce employees’ walking time by 90%. This example shows that AGVs can support higher efficiencies along the supply chain.

Planning AGV Utilization

Today’s supply chains pose increasing challenges, but automated guided vehicles can overcome many of them. However, any AGV-related plans must carefully consider worker training, traffic flow, tech infrastructure and other necessities.

Addressing those matters early in the process boosts the chance of success and provides a strong return on investment. Getting inspired by supply chain partners currently using AGVs in their processes is an excellent way to explore what is possible.

About the author:

Emily Newton reports on how technology disrupts industrial sectors. She’s also the editor-in-chief of Revolutionized, covering innovations in industry, construction, and more.

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At WD-40 Co., ecommerce underpins all “must-win” battles

Paul Demery — Wed, 24 Jul 2024 20:21:10 +0000

WD-40 Co. is reporting positive developments across its global sales operations, and ecommerce is crucial them all, president and CEO Steve Brass says.

We see ecommerce as an accelerator for all our other must-win battles

Steve Brass, president and CEO

WD-40 Co.

Steve Brass, president and CEO, WD-40 Co.

In a recent earnings call, he said the manufacturer and marketer of industrial and residential lubricants, degreasers and cleansers is making progress on its four “must-win” competitive market battles:

Geographic expansion worldwide.
Increasing premium product sales.
Growing its Specialist product line for mechanics and other professionals.
Accelerating digital commerce.

Although Brass listed ecommerce fourth on the company’s must-win list, he said it was critical to the other three.

“We see [ecommerce] as an accelerator for all our other must-win battles, as it improves brand awareness and online engagement, leading to an improved customer experience and sales across all our trade channels,” Brass said on a recent earnings call, according to a transcript from Seeking Alpha.

He added, “Some of our key objectives within this must-win [ecommerce] battle are to build our brand digitally, grow and develop the ecommerce pure play channel, accelerate growth of the omnichannel, and continue capability-building for our employees.”

Brass went on to note that WD-40’s digital commerce strategy resulted in an 18% company-wide year-over-year ecommerce sales increase through the first nine months of its current fiscal year, “with double-digit growth across the company’s three trade blocks of EIMEA (Europe India Middle East Africa), the Americas, and Asia-Pacific.

The company said total net sales rose 9.4% to $155.05 million for the fiscal third quarter ended May 31; net income increased 5.0% to $19.84 million from $18.90 million.

For the nine months ended May 31, net sales increased 9.5% to $434.57 million from $396.80 million as net income rose 7.0% to $52.86 million from $49.42 million.

Growing sales through online distributors

The company has said its sharpest growth is via ecommerce sales through such business-to-business ecommerce sites as Grainger.com, MSCDirect.com, GlobalIndustrial.com, Fastenal.com and MotionIndustries.com and such online retailers as Amazon, Ace Hardware and Aubuchon Hardware. WD-40 customers can link directly to these ecommerce sites from WD-40.com.

WD-40 is also taking other steps with digital technology to build on its online interactions with customers and drive up operating efficiency.

An online contest WD-40 launched in 2021, Repair Challenge, has invited customers across more than 40 countries — including “doers, makers, fixers and builders” — to show how use WD-40 lubricants and other products to extend the lifespan of their tools, bicycles, cars and other items. Brass said that, so far, the contest has created over 0.5 billion online marketing impressions worldwide.

WD-40 is also “making foundational investments in systems and data that will allow us to grow faster,” Brass said. For example, he said WD-40 had rolled out Salesforce Inc.’s CRM technology in the U.S. and will be expanding it in the near term, “driving sales efficiencies and effectiveness.”

“Use of data analytics and automated tools, leveraging data is increasing and can be a real enabler for the business,” he said. “The foundational work we are doing now around data governance, centralizing our data architecture and data quality management will allow our people to leverage our data quicker and drive better decision-making.”

Brass added that WD-40 has engaged an investment bank to seek suitors for its U.S. and U.K. home-care and cleaning product brands, which account for about 4% of total sales, and expects to sell them in the company’s 2025 fiscal year.

“Post divestiture, WD-40 Co. will be a more focused company with a higher sales growth and gross margin profile,” he said.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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How HDA Truck Pride is overhauling fleet services online

Paul Demery — Thu, 18 Jul 2024 22:13:15 +0000

HDA Truck Pride has roots going back about 30 years in helping sellers of truck parts and services keep large commercial vehicles running across U.S. roadways.

This is what is helping us build the HDA network to the fleets across the country.

Curt Westphal, director of program development

HDA Truck Pride

Curt Westphal, director of program development, HDA Truck Pride

But this year, HDA is going beyond its traditional role as a truck-parts buying group for its more than 140 member companies. Its members operate in aggregate 900 facilities across the U.S., servicing many thousands of trucks, from single-owner-operators to corporate fleets with thousands of vehicles.

It hasn’t been easy to build customer loyalty among fleets and individual truckers across the country, but that’s the route HDA says it’s now taking with its new FUSE National Fleet Program.

In April, HDA launched the FUSE program with TreviPay, a B2B payment technology and services provider. In the FUSE web portal, trucking companies can apply for credit terms that they can use throughout the HDA member network. And at the end of a billing period, they can view a single statement to manage and pay invoices from hundreds of parts and repair shops.

“This is what is helping us build the HDA network to the fleets across the country,” says Curt Westphal, HDA’s director of program development.

A mechanic works on a truck breaking system at an HDA Truck Pride network service center.

Westphal says he expects the FUSE program to support more consistent connections between its member companies and truck fleets, leading to larger average order sizes while sellers avoid taking on credit risk. TreviPay extends the credit terms after an expedited credit check and takes on the risk.

More accurate invoices, faster payments

Westphal adds that a main benefit of the FUSE program is the ability it has shown to improve invoice accuracy by 90%, resulting in faster payments. He says the FUSE program lets the customers of HDA’s companies control their purchase order specifications, which goes a long way toward ensuring the accuracy of purchase orders and invoices processed through the FUSE portal. The system avoids manual double-entry of documents, supporting the increase in accuracy, he adds.

Westphal notes that HDA has already onboarded more than half of its140-plus member companies and is gradually adding fleet customers.

He adds that the FUSE program also lets fleet customers click a portal button to dispute any unrecognized charges, giving sellers the opportunity to directly work out any discrepancies.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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Digital trends drive growth at global shipping marketplace Freightos

Paul Demery — Tue, 16 Jul 2024 17:00:53 +0000

International freight movements in the second quarter grew at unexpectedly high rates, surprising experts who had expected lower transaction volume tied to the ongoing Red Sea crisis, online shipping marketplace Freightos said yesterday.

A Houthi spokesperson stated in December that they would target “ships affiliated to Israel or transporting commodities to Israeli ports” and continue to do so if “food and medicine keep not accessing the Gaza Strip.”

This significant transaction growth highlights the growing adoption of digital solutions in the freight industry.

The online freight-booking and payments platform said it facilitated a 32% year-over-year increase in the number of transactions to 316,500, exceeding management’s Q2 expectations.

Freightos transaction volume in Q2

Freightos said in a statement that it had expected transaction volume to grow between 27% and 29% to a range of 303,000 and 309,000 transactions. It also said the Q2 growth rate of 32% outpaced its long-term targeted growth rate range of 20-30%.

“This significant transaction growth highlights the growing adoption of digital solutions in the freight industry,” Freightos said.

Freightos added that steady freight prices resulted in corresponding increases in its Q2 gross booking value. It also exceeded expectations by growing 31% to $203.4 million. Freightos had expected Q2 booking value would rise only 15%-18% to a range of $178 million to $182 million.

Freightos lets importers and exporters compare freight shipping rates, book shipments and pay for services through Freightos.com. It also provides software for air and ocean carriers and freight forwarders for managing quoting, pricing, bookings and other operations.

An expanding base of buyers and carriers

Despite its prior slower-growth expectations, Freightos prepared in Q2 for more long-term growth by expanding its air and ocean carrier network by 38% to 51 from 37 carriers. In addition, its number of unique “buyer users” in Q2 increased 16% to approximately 19,000.

Freightos notes that its buyer organizations range from small and midsized businesses to large multinational organizations. Its number of buyer users includes all the individuals placing bookings on its platform. A spokesman adds that Freightos has an average of more than 5,000 bookings per workday.

“This growth underscores the ongoing marketplace network effects, where buyers attract sellers and sellers attract buyers,” Freightos said.

Handling spot freight market growth

Freightos also attributed its growth to its ability to serve the spot freight market, or freight shipments handled outside of long-term contracts.

“This momentum represents the continued digitalization of the spot freight market, estimated to comprise 30%-50% of the total air and ocean freight market,” the marketplace company said.

As part of its carrier network expansion, Freightos in June announced agreements with Thai Airlines and Coyne Airways, carriers on Freightos.com that will use the WebCargo by Freightos digital booking and payment platform to manage freight services across areas including Asia, Africa, and the Persian Gulf and Caspian regions.

Barcelona, Spain-based Freightos said it will host a conference call to discuss its Q2 financial results and Q3 outlook on Aug. 19.

Here’s last quarter’s update on Freightos.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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For Parts Town, innovation means more and faster same-day delivery

Paul Demery — Wed, 29 May 2024 16:11:41 +0000

Parts Town Unlimited is ramping up its delivery service in its ongoing drive to innovate.

To help its customers cut their downtime from broken kitchen and HVAC equipment, the food-service and HVAC parts distributor has more than doubled its same-day parts delivery service to a 50-mile radius — often within two hours — from over 130 locations across the United States.

Parts Town is providing the expanded service through a strategic partnership with Roadie, a UPS company specializing in logistics management. Roadie operates as a crowdsourced delivery platform providing last-mile deliveries.

Parts Town is using Roadie to let customers order original equipment manufacturer (OEM) parts from over 130 Parts In Town stocking and service locations throughout the U.S. Parts In Town is an online marketplace on PartsTown.com where customers can purchase parts and services from the Parts Town service center nearest their facility.

The expanded same-day delivery service includes products ordered from Parts Town’s largest distribution center in its home base of Addison, Illinois, providing deliveries as fast as two hours to the entire city of Chicago, according to Roadie and Parts Town.

Increasing first-time fix rates

Parts Town says it developed the expedited deliveries with Roadie to support to help service technicians increase their number of “first-time fix rates” and decrease the amount of equipment downtime for customers.

Emanuela Delgado, group vice president of the revolution, growth and innovation, Parts Town

“The expansion of our same-day delivery radius is a step change in the ultra-fast accessibility of OEM parts locally,” says Emanuela Delgado, who has the dual title of Group Vice President of The Revolution and GVP of Growth and Innovation, Parts Town Unlimited. “This partnership is the latest example of our commitment to not only ensuring genuine OEM parts reach our customers quickly and seamlessly but also to providing tools for service technicians and our end-user customers to increase first-time fix rates and reduce equipment downtime.”

Over the past several years, Parts Town has worked to build a reputation for innovation through such technology and services as its AI-powered PartPredictor tool for helping customers proactively manage equipment repairs with replacement parts; a mobile app for placing and tracking orders and accessing manuals; and a robotics-driven automated distribution system.

Parts Town reported $2.3 billion in revenue last year, up from $1.8 billion in 2022.

“We’re a distribution company, but we’re really more of a digital technology company that has distribution,” Delgado has said.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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Air cargo marketplace Freightos posts record Q1 volume

Paul Demery — Wed, 22 May 2024 20:01:38 +0000

Freightos is off to an unexpectedly robust start this year, as lagging first-quarter Red Sea disruption continued to shift international cargo to air freight booked through its digital marketplace, the company said this week.

But Freightos also attributes the quarter’s record transaction volume to the company’s ongoing investments in digitalizing international freight management to bring more value to shippers.

The company said the volume of gross bookings processed through its digital platform surged 29% year over year to 295,600 transactions. Revenue increased 11% to $5.4 million as gross booking value grew 14% to $192.4 million. The number of unique buyers digitally booking freight services increased 11% to 18,000.

Targeting an 80% market share

Zvi Schreiber, CEO, Freightos

CEO Zvi Schreiber said on an earnings call this week that Q1 marked the “seventeenth straight quarter of record transactions,” that the total transaction value exceeded the company’s expectations for the quarter, and that Freightos “maintained a share of approximately 80% of all international air cargo digital bookings on platforms.”

“This performance highlights the robustness and growing acceptance of our platform, and the strides we’re making digitalizing international freight in order to bring efficiency and transparency to this crucial sector,” he said.

He added, “We continue to consider transaction growth to be the most important caveat for our business. And it’s consistent with as the prime proof points of the benefits users gain from the marketplace was built for them.”

Schreiber also noted, however, that overall Q1 shipping rates remained higher than expected because many carriers were still avoiding the Suez Canal because of the Red Sea crisis and shifting to air cargo, resulting in higher rates.

Still, Freightos is also pushing ahead on several fronts, Schreiber said.

Focusing on new freight opportunities

“We pursued several initiatives to increase not only the number but also the value of the transactions, including investing in Asia, and an emphasis on high value shipments such as pharma. Looking ahead, we remain focused on the opportunities in the massive air and ocean freight markets, driving continued growth and innovation in the quarters to come.”

“The first quarter results exceeded our expectations in every metric: the number of transactions, gross booking value, revenue, and profitability,” said Ran Shalev, chief financial officer.

Freightos ended the quarter with 49 cargo carriers on its platform. It recently announced the addition of several airlines participating as sellers of air freight services, including Delta

Cargo, Singapore Airlines and Fits Cargo. Last week, Freightos said United Airlines had chosen Freightos as its technology partner to build a “state-of-the-art” air cargo web portal for freight forwarder and other businesses working with United’s cargo services.

To foster more transactions on its platform, Freightos has been displaying service recommendations.

“We started dynamically suggesting alternative options when people book, including highlighting premium air content products like express on relevant searches, driving more value and, in some cases, increasing our transactional revenue,” Schreiber said on the earnings call. “These enhanced service offerings contribute to our monetization efforts, optimizing how we generate revenue from each transaction.”

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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B2B auctioneer RB Global doubles Q1 gross transaction value to $4.1 billion

Paul Demery — Wed, 15 May 2024 20:30:28 +0000

A broadened digital presence in B2B and retail auction sales and related services has thrust auctioneer RB Global Inc. to a higher financial performance level.

RB Global is making “excellent strides in attracting new international automotive buyers to our marketplace.

James Kessler, CEO

RB Global Inc.

James Kessler, CEO, RB Global

The company’s first-quarter revenue surged 108% year over year to $1.1 billion, as gross transaction volume grew 115% to $4.1 billion. Net income rose to $107.4 million from a year-earlier net loss of $28.2 million.

RB Global attributed much of the increases to its Q2 2023 $7.3 billion acquisition of motor vehicle auction company IAA Inc. IAA, which still operates under the same name as an RB Global unit, sells via online auctions “lightly damaged, salvage, and clear-title vehicles, including cars, trucks and motorcycles, to buyers across the U.S. and in some international markets.”

RB Global is making “excellent strides in attracting new international automotive buyers to our marketplace, partially driven by IAA leverage and historical Ritchie Bros. relationships in Europe,” CEO James Kessler said on a Q1 earnings call this week. He added that the percentage of vehicles sold to international buyers hit an all-time high in the quarter and complemented RB Global’s technology investments and process improvements to raise average selling prices by 3.3%.

Following the IAA deal, RB Global changed its corporate name from Ritchie Bros. Auctioneers to reflect its globally expanded scope. Ritchie Bros. Auctioneers continues as an RB Global unit selling heavy trucks and construction equipment.

Responding to Yellow Corp.

Kessler also pointed to other ways that RB Global’s digital omnichannel platform serves as a “key differentiator” in the motor vehicle and equipment auction business.

For example, he said the bankruptcy filing last year of trucking company Yellow Corp. demonstrated “the power and versatility of our platform.” RB Global used the VeriTread “heavy-haul” service on its marketplace platform to source “competitively priced transportation services” to help move Yellow’s assets to RB Global and IAA auction yards.

RB Global also operates the equipment and vehicle auction and buy-now marketplaces at IronPlanet.com and Mascus.com.

RB Global’s brand portfolio includes:

Rouse Services, which provides an asset management, data-driven intelligence and performance benchmarking system;
SmartEquip Inc. (“SmartEquip”), a digital technology platform that supports customers’ management of the equipment lifecycle and integrates parts procurement with both OEMs and dealers.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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Uber Freight ramps up its executive team and digital technology

Paul Demery — Tue, 23 Apr 2024 21:08:32 +0000

Launched in 2017, Uber Freight is out to show that its startup days are far behind it.

Dan Annunziata, head of commercial, Uber Freight

Just ask Dan Annunziata, whom Uber Freight recently hired away from third-party logistics services giant CH Robinson to fill the new role of head of commercial, focused on strengthening strategic relationships with shippers.

“Uber Freight has a compelling value proposition for shippers of all types: long gone are the days of the perceived digital startup,” he said earlier this month when taking his new position.

Along with Annunziata, Uber Freight also announced the appointment of former Amazon, Walmart and Chewy logistics and parcel delivery executive Hany Elkordy as its new head of logistics, last-mile solutions.

Investing in AI amid talk of an IPO or sale

The two executives follow several other strategic hires at Uber Freight, a business unit of ride-hailing company Uber Technologies Inc. In addition, in recent months Uber Freight has invested in AI-powered logistics management technology and started a pilot rollout of a logistics scheduling application programming interface, or API, for the Uber Freight transportation management system in accordance with the Scheduling Standards Consortium’s Technical Standard.

All of these activities coincide with reports last month by Bloomberg and other news organizations that Uber Technologies was considering spinning off Uber Freight through an initial public offering of stock or a sale of the freight unit.

But Uber made no mention of a possible sale or IPO along with its recent personnel and technology announcements.

Focusing on strategic partnerships with shippers

The company says Annunziata’s “primary focus will be on unifying the commercial, sales ops and solutions organization to deliver end-to-end solutions, broadening and strengthening Uber Freight’s position as a strategic partner for shippers.”

“Uber Freight is a global enterprise with more than 5,200 employees and a formidable presence in the U.S., Mexico, Canada, and Europe,” Annunziata says. “Our capabilities span from 3PL and transportation management services to capacity solutions across truckload, LTL, IMDL, and cross border.” (LTL and IMDL stand for less-than-truckload and intermodal.)

Hany Elkordy, head of logistics, last-mile solutions, Uber Freight

In his new role, Elkordy will “spearhead parcel modality enhancements and expansion, working closely with product, operations and technology teams,” Uber says.

When it announced AI projects last fall, Uber Freight said it had invested $120 million since 2021 to provide better visibility into and control of logistics operations through technology designed for “scaling enterprise applications that span logistics software solutions, generative AI and data-enabled insights tools, as well as innovative capacity and mode expansions.”

Launching Uber Freight Exchange

Uber Freight also launched last fall Uber Freight Exchange, which is designed to expedite freight procurement cycles and shipment processes. Shippers can use Uber Freight Exchange to run auctions with their own carriers in addition to Uber Freight’s network of 100,000 carriers across the U.S.

Among its AI developments, Uber Freight has unveiled Insights AI, a generative AI-powered tool designed to help logistics management teams work with “more complex, strategic analyses” when making logistics management decisions. “Insights AI will leverage LLMs (large language models) to generate and surface insights from Uber Freight’s vast store of transportation data for customers.”

The company is also working with AI and machine learning to “drive network optimization and service improvements at scale” through ETA (estimated time of arrival) and PLA (probability of late arrival) applications. Uber says these tools are designed to help drive “automated self-healing workflows to improve shipper service.”

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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